What is the truth about the state of the industry? Will the Guild's proposals prevent further experimentation and hinder future business models in New Media, as the AMPTP has claimed?
1. As the marketplace changes the media companies are already positioned to adapt and capture New Media revenue. There are reports almost daily in the press about business models that have been developed to generate revenue through download-to-own sales, subscriptions and advertisements partnered with content.
2. The WGA would not be the first organization to reach agreement with the Companies on sharing revenues derived from content on new media platforms. CBS and Viacom content can be found on the web service Joost. The new NBCU-News Corp online video initiative will distribute content through AOL, Yahoo, Microsoft, and a host of other sites.
3. Content distribution deals made by studios and networks include revenue sharing agreements that guarantee networks and studios a percentage of advertising revenue generated from the content. Why not the writers, actors and directors who created the content?
4. The entertainment industry is very healthy and our proposals only seek to provide writers with a fair share of the success they have created.
a. Since 2000, Media Conglomerate Revenue from Entertainment Segments has increased 51% from $63 billion to $95 billion.
b. Over the same period of time, Writer Earnings and Residuals have increased only 20% from $1.1 billion to $1.3 billion.
Entertainment Segment Revenue and
Writer Earnings and Residuals 2000-2006
(Source: WGA Analysis of SEC filings and Company Annual Reports)
5. There is some ambiguity in the emerging new media landscape, but the formulas we are proposing for new technologies are percentages of revenue -- when they get paid, we get paid. If they don't, we don't. The formulas are technology neutral, and flexible enough to accommodate experimentation with new business models. As the companies develop their business models, residuals are simply an equitable cost of doing business.
6. The WGA is committed to bargaining a fair and reasonable contract that benefits both parties; but we refuse to negotiate off of the producers' proposals that would eviscerate the current MBA.